Corrections Corp., RealD Rise after Barron’s Articles

By Avi Salzman

Two companies that got positive coverage in this week’s Barron’s enjoyed a bounce on Monday.

Senior Editor Leslie P. Norton’s article “3D Springs back to Life” helped bolster RealD (RLD), a company that deals with 3D technology in the film and entertainment industries. The stock which opened at $13.92 a share and rose more than 3% to $14.34 in early trading. More recently, it was up 2.4%.

In her review, Norton notes that 3D technology is expanding into arenas where it wasn’t previously used.

“Predicting box-office success, of course, is a mug’s game. But 3D is gaining traction,” writes Norton. “In December Baz Luhrmann, who directed Chicago, will be releasing The Great Gatsby in 3D, an important chance to expand the technology’s repertoire to more serious fare. As production costs fall, more directors are likely to embrace 3D.”

B. Riley analyst Eric Wold also raised his price target on RealD on Monday to $18.50 from $15.50.

“We continue to believe the mindset towards RealD has improved dramatically recently through stronger global 3D box office trends, demonstrated support of the 3D format from studios, an aggressive move to take international market share from embedded competitors as well as the long-awaited shift to positive free cash flow this year,” wrote Wold.

Prison management company Corrections Corporation of America (CXW) opened at $26.58 a share and rose 1.5% to $27 after Senior Editor Jonathan R. Liang wrote in “Ready to Bust Out” that the company has strong prospects, particularly if it converts into a REIT.

Although the company declined to speak directly with Liang on the matter, he wrote, “transforming itself into a REIT should appeal to a management team that has shown itself to be shareholder-friendly, with well-timed stock buybacks and the recent institution of an 80-cents-a-share annual dividend.” Shares were recently trading 0.5% higher, but had risen more earlier in the day.

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